In coming months the regulators will engage further with domestic market participants
around the findings and recommendations set out in this report.

In the first instance, the recommendations around bilateral risk management practices,
set out in Section 6.4,
are largely able to be pursued by market participants without the need for
specific regulatory action. The regulators will look to monitor progress on
these recommendations in discussion with industry, and will pursue further
action with market participants where necessary.

Effecting the recommendations around trade reporting made in Section 6.2
relies on the passage of the Derivative Transactions Bill. Should the Parliament
pass this legislation, and the government look to implement a mandatory reporting
obligation, the regulators – led by ASIC – would then develop the
licensing framework for trade repositories and the contents of any trade reporting
obligations. This would be done in close consultation with market participants
and other stakeholders.

Regarding central clearing, the regulators are keen to support industry-led solutions
in this area, as discussed in Section 6.3.
However, should there be insufficient progress by the Australian market in
migrating to central clearing for Australian dollar-denominated interest rate
derivatives in particular, regulatory intervention may be necessary. ASIC and
the RBA acknowledge their responsibility for dealing expeditiously with any
proposals from CCPs seeking to provide services in Australia. The regulators
remain keen to discuss with stakeholders concerns around other impediments,
such as operational and other design elements, while the development of mutually
acceptable client clearing agreements is a matter in which the regulators have
a particular interest. The regulators will also give consideration to how best
to manage systemic risks in other markets that are not currently amenable to
central clearing, such as cross-currency and FX derivatives.

The regulators will continue to review if and how any further regulatory intervention
may be warranted to further enhance the efficiency, integrity and stability
of the Australian OTC derivatives market and the broader Australian financial
system. As part of this, it is currently anticipated that additional market
reports will be undertaken in the period ahead.